Cisco Acquires Storage Networking Company

Hoping to increase its involvement in the network storage market, Cisco Systems will pay up to $2.5 billion to acquire Andiamo Systems, a privately held company. Cisco has already spent $53 million to purchase a stake in the company, which makes Storage Area Network (SAN) products. Currently, Cisco is the exclusive manufacturer and distributor of Andiamo products.

Cisco expects the acquisition to help it compete with companies such as Brocade Communications. The acquisition will close in the third quarter of Cisco's 2004 fiscal year (February to April 2004), but no later than July 31, 2004. Later this year, Cisco plans to launch new Andiamo and Cisco SAN products that support Fibre Channel, Internet SCSI (iSCSI), and Fibre Channel over IP. The first product, the MDS 9000, will be available in fourth quarter 2002.